WASHINGTON – The Environmental Working Group and other organizations are urging the New York Senate to pass legislation that would impose a two-year pause on new “proof of work” cryptocurrency miners who are seeking to revive shuttered fossil fuel power plants to generate electricity for their operations.
The legislation, approved last week by the state Assembly, would apply only to bitcoin mining operations seeking new permits or renewing current permits to use decommissioned fossil fuel plants. It would also require the state’s Department of Environmental Conservation, or DEC, to produce an environmental impact statement, as reported by the New York Daily News.
The bill was authored by Assemblywoman Anna Kelles, Ph.D. (D-Ithaca), and in the upper chamber is sponsored by Sen. Kevin Parker (D-Brooklyn). If the Senate approves the bill and Democratic Gov. Kathy Hochul signs it, the moratorium would be the most extensive law anywhere in the nation addressing the use of fossil-fuel-powered cryptocurrency mining operations.
“We applaud the Assembly for taking this important step to protect the environment and public health and hope the state Senate will follow suit,” said EWG Energy Policy Director Jessica Hernandez. “Industries, including proof of work cryptocurrencies like bitcoin, should prioritize curbing their emissions to combat climate change – not try to keep using fossil fuels to power their operations.”
“It is important the DEC fully grasp the scope of the impacts before issuing any new permits. Passage of this bill would align with the ambitious climate goals in New York’s climate law,” she added.
“Should proof of work cryptocurrency expand unchecked in New York, the state’s climate mandates would become nearly impossible to meet,” said Liz Moran, New York policy advocate for Earthjustice. “According to global climate scientists, the world must rapidly move away from fossil fuels and cut greenhouse gas emissions before the end of the decade to avoid climate catastrophe – but expanded proof of work mining would take us in the opposite direction.”
“We applaud the Assembly for passing this incredibly reasonable legislation, which will temporarily stop these cryptocurrency mining operations from setting up shop and repowering old gas plants while DEC conducts an environmental review,” Moran said. “New York can’t afford to undercut its own climate law – we urge the Senate to follow the Assembly and pass this legislation again,” she added, referring to a previous version of the moratorium bill, which passed in the Senate last year.
“New York’s ambitious climate law was enacted without ever anticipating energy-hungry cryptocurrency mining facilities and their ability to revive the dirtiest, most inefficient power plants in the state,” said Roger Downs, conservation director for the Sierra Club Atlantic Chapter.
“We applaud Assemblymember Kelles and [New York Assembly] Speaker [Carl] Heastie for recognizing that if we don’t take a pause to consider the impacts of behind the meter, proof of work cryptocurrency mining, this kind of digital partnership could soon be an integral component of every fossil fuel plant operating in New York and slow our transition to renewable energy,” Downs said.
“We once again call upon the Senate to pass this legislation to avoid upending the state’s solemn climate obligations,” he added.
Electricity-intensive transactions
Proof of work is a bitcoin transaction validation method that is very electricity-intensive, since it requires the use of a massive number of computers to solve complex math puzzles to “mine” the cryptocurrency. Many operations are pursuing the use of shuttered fossil fuel power plants to deliver the huge amount of electricity required to stay competitive in the growing, cut-throat global cryptocurrency sector.
“I applaud the Assembly for putting New Yorkers and the planet first and taking steps to curb this dangerous industry," said Yvonne Taylor, vice president of Seneca Lake Guardian. “The Senate must immediately take up and repass the moratorium bill, as it did last year by a substantial margin.”
The best example of an electricity-guzzling bitcoin mining operation in New York is owned by Greenidge Generation, which repurposed a formerly decommissioned coal-fired power plant located on the pristine Seneca Lake, in the Finger Lakes region. The plant now burns fracked fossil gas around the clock to provide enough electricity to power the array of computers needed to mine bitcoin, polluting the surrounding communities, which thought those days were behind them.
Taylor emphasized that New Yorkers are heavily engaged on the bitcoin issue, as evidenced by the 4,000 public comments sent to DEC about Greenidge Generation's air permit renewal, 98.8 percent of which opposed the plant's crypto-mining operations. She said emissions increases due to bitcoin would be at odds with New York’s Climate Leadership and Community Protection Act, or CLCPA, which requires the state to cut greenhouse gases 40 percent by 2030.
“In the Finger Lakes and across the state, outside speculators are invading our communities to destroy our natural resources, kneecap local businesses and keep us from meeting the crucial climate goals outlined by the CLCPA, just to make a few people very, very rich,” Taylor added.
New York is believed to have the most bitcoin mining in the U.S., but operations are surging in other states, including Georgia, Kentucky and Texas, among others.
A validation method used by other cryptocurrencies, known as “proof of stake,” requires about 99 percent less electricity than proof of work. Ethereum, the second largest cryptocurrency, is transitioning away from the electricity-intensive proof of work method to proof of stake.
EWG has joined Greenpeace USA in launching a national campaign to shed light on the electricity and climate implications of bitcoin mining and its effect on our climate goals. Find out more here about the campaign, Change the Code, Not the Climate.
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The Environmental Working Group is a nonprofit, non-partisan organization that empowers people to live healthier lives in a healthier environment. Through research, advocacy and unique education tools, EWG drives consumer choice and civic action.
